Japan’s second most senior banking figure has stated central banks cannot use digital currencies to enforce negative interest rates, Reuters reported on July 5.

Speaking at an occasion held by the publication, Masayoshi Amamiya, deputy governor of the Bank of Japan, stated that states issuing digital currency with a negative rate of interest would force inhabitants towards money.

This money supply would stay, Amaiya said, and despite the present trend to exchange it, no government would really do, therefore.

“To overcome the nominal zero bound, central banks would want to eliminate money,” he hypothesized.

“Eliminating money would create settlement infrastructure inconvenient for the general public, therefore no financial organization would do that.”

Negative interest rates refer to banks charging holders of deposits to keep them invested. Japan was one amongst the countries taking up the practice in 2016, alongside the EU central bank.

At the time, Top Market Group reported on the potential for decentralized cryptocurrencies like bitcoin (BTC) to produce a secure alternative to effectively paying to use cash.

Japan’s bitcoin infrastructure is a lot of advanced than most, with a comprehensive regulative system permitting the emergence of bonafide exchanges and thousands of bitcoin-accepting merchants.

Other jurisdictions a lot of hostile to bitcoin have in recent times either issued or proclaimed their intention to issue a government-backed digital currency.

These include Venezuela, that already launched Petro, similarly as India and Iran. The latter have each declared bitcoin as actual illegal.

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